The International Air Transport Association (IATA), has put the foreign airlines trapped funds in Africa at $1.68 billion as at September 30, 2023.
Some of the countries with trapped funds are Ghana, Nigeria, Ethiopia, Angola and Zimbabwe, reports Daily Independent.
Kamil Al Alwadi, the Regional Vice-President of Africa and Middle East, IATA stated these recently at the 55th Annual General Meeting (AGM) of the African Airlines Association (AFRAA) held in Entebbe, Uganda.
Alwadi attributed the trapped funds crisis to one of the major issues plaguing aviation in Africa, describing the amount of money trapped as alarming, while also having a huge and devastating impact on connectivity.
He said: “Aviation is capital intensive. Cash flow is key for airlines’ business sustainability – when airlines are not able to repatriate their funds, it severely impacts their operations and their decisions on where to fly.
“But, the risk of blocked funds is not just limited to airlines; the negative impact extends to the countries blocking the funds. It impacts the country’s economy and its connectivity, and it hurts investor confidence and reputation. Aviation is not only an economic enabler; it is a pillar of modern economies.”
Governments, he said must prioritise aviation and find sustainable solutions in the clearing of blocked funds, assuring that IATA would continue to offer its support in any way it could.
The IATA chief lamented the state of aviation infrastructure in the continent, stressing that the facilities come with a high price tag, lamenting that user charges across the continent are 8 per cent higher than the industry average.
He disclosed that infrastructure charges must be set at levels that are fair, justified, and reflective of a value service proposition for airlines and passengers, adding that efforts through a pan-Africa fuel campaign have resulted in charges reductions in Chad, the Ivory Coast, and Zambia over the last five years.
Statistics show that Niamey, Niger Republic tops the list by charging passengers $162 on regional departure in African airports, followed by Monrovia (Liberia) $145; Guinea Bissau $137; Dakar, Senegal $116; Douala, Cameroon $115; Bangui $111; Freetown, Sierra Leone $109 and Nigeria $100.
International travelers at Bamako, Mali, Antananarivo, Madagascar, Cotonou, Benin Republic, Kinshasa, and Zaire pay $99; $91, $88, and $77 respectively. In Accra, Ghana it costs $77, N’djamena $68, Djibouti $67, Cairo $467, Lome, Togo $62, Entebbe, Uganda is $57. Charges by other African nations oscillate between $50 and $3.
“Last month, we saw successful trials with Kenya Airways and Ethiopian Airlines carried out with the support of AFRAA. We also continue to champion contingency management in the region and look in 2024 to drive more change through Focus Africa to ensure resilience in our system.”
